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COMPANY REGISTRATION NUMBER: 04415888
Peregrine Livefoods Ltd
Financial Statements
31 May 2023
Peregrine Livefoods Ltd
Financial Statements
Year ended 31 May 2023
Contents
Page
Officers and professional advisers
1
Strategic report
2
Directors' report
4
Independent auditor's report to the members
6
Statement of comprehensive income
10
Statement of financial position
11
Statement of changes in equity
12
Statement of cash flows
13
Notes to the financial statements
14
Peregrine Livefoods Ltd
Officers and Professional Advisers
The board of directors
C M Jones
D R Bovis (Resigned 17 August 2022)
J Daniel (Appointed 3 April 2023)
R Beattie (Appointed 3 April 2023)
Registered office
Rolls Farm Barn
Hastingwood Road
Magdalen Laver
Essex
CM5 0EN
Auditor
Edmund Carr LLP
Chartered Accountants & Statutory Auditor
146 New London Road
Chelmsford
Essex
CM2 0AW
Bankers
Barclays Bank plc
One Churchill Place
London
E14 5HP
Peregrine Livefoods Ltd
Strategic Report
Year ended 31 May 2023
The directors present their strategic report for the year ended 31 May 2023 for Peregrine Livefoods Limited (registered number 04415888 ). PRINCIPAL ACTIVITY The Company's principal activities remain unchanged from previous years, which is the provision of livefoods, live animals, frozen foods and dry goods. Principally supply is to companies operating within the pet sector but also to related businesses such as zoos and educational establishments.
BUSINESS REVIEW The latest financial year was expected to be challenging, and it indeed proved to be so. While our underlying food and consumable sales remained robust, the number of new entrants to the pet reptile market decreased, and existing pet reptile owners had limited disposable income to upgrade their pet setups. Consequently, this led to a modest 4% reduction in revenue. Throughout the year, the business made significant investments, including the installation of over 1,200 solar panels to counter recent energy price fluctuations and ensure sustainable energy for the long term. Additionally, new production machinery was acquired to enhance efficiency and reliability in operations. These investments benefited from government tax incentives and are poised to benefit the business for years to come. Despite incurring a loss before tax in the financial year, the business's performance has improved, with both gross and net margins increasing. The loss was primarily attributable to elevated interest costs, driven by BOE interest rates rising from 1% to 4.5% over the financial year. Although most of the interest payable is on fixed rates and tied to the investments made, future increases in the base rate are not expected to impact the business. Nonetheless, the company remains a dominant force in the niche industry, boasting a diversified customer base expanded over the past year. Ongoing efforts to streamline operations have resulted in increased stability and profitability. As such, we anticipate a rise in revenue and profit for the 2024 financial year.
PRINCIPAL RISKS The primary risks facing the business stem from economic volatility, including the impact of high inflation, rising interest rates, and energy prices. However, with inflation on the decline and energy prices following suit, we remain hopeful that interest rates will soon follow suit. Price erosion remains a concern, but ongoing cost reviews and efficiency measures help mitigate this risk. The company Directors regularly discuss risk and strategy and respond accordingly. Furthermore, the company continues to support the protection of the exotic pet industry in the UK by partially funding the Reptile and Exotic Pet Trade Association (REPTA).
KEY PERFORMANCE INDICATORS Sales in the year ended 31 May 23 were £20,015,524 down 4% on last year Gross profit decreased by 1.5% with overheads decreasing by 2%, the loss before tax for the year ended 31 May 2023 was (£58,131) compared to a profit before tax of £44,160 for the year ended 31 May 2022 The business will continue to push greater focus onto gross margin and net margin moving into the next financial year, whilst also improving customer satisfaction and employee satisfaction through our Net Promoter scoring systems.
This report was approved by the board of directors on 19 February 2024 and signed on behalf of the board by:
C M Jones
Director
Registered office:
Rolls Farm Barn
Hastingwood Road
Magdalen Laver
Essex
CM5 0EN
Peregrine Livefoods Ltd
Directors' Report
Year ended 31 May 2023
The directors present their report and the financial statements of the company for the year ended 31 May 2023 .
Directors
The directors who served the company during the year were as follows:
C M Jones
J Daniel
(Appointed 3 April 2023)
R Beattie
(Appointed 3 April 2023)
D R Bovis
(Resigned 17 August 2022)
Dividends
Particulars of dividends paid are detailed in note 11 to the financial statements.
Disclosure of information in the strategic report
In accordance with Section 414C(11) of the Companies Act 2006, the company has included a Strategic Report within the financial statements, outlining the performance of the company along with a description of the principal risks and uncertainties facing the company.
Directors' responsibilities statement
The directors are responsible for preparing the strategic report, directors' report and the financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and accounting estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This report was approved by the board of directors on 19 February 2024 and signed on behalf of the board by:
C M Jones
Director
Registered office:
Rolls Farm Barn
Hastingwood Road
Magdalen Laver
Essex
CM5 0EN
Peregrine Livefoods Ltd
Independent Auditor's Report to the Members of Peregrine Livefoods Ltd
Year ended 31 May 2023
Opinion
We have audited the financial statements of Peregrine Livefoods Ltd (the 'company') for the year ended 31 May 2023 which comprise the statement of comprehensive income, statement of financial position, statement of changes in equity, statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements: - give a true and fair view of the state of the company's affairs as at 31 May 2023 and of its loss for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows; - The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations. - We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management. We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur by; - Making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud. - Considering the internal controls in place to mitigate the risks of fraud and non-compliance with laws and regulations To address the risk of fraud through management bias and override of controls, we; - Performed analytical procedures to identify any unusual or unexpected relationships - Tested journal entries to identify unusual transactions - Assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: - Agreeing financial statement disclosures to underlying supporting documentation - Enquiring of management as to actual and potential litigation and claims Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Use of our report
This report is made solely to the company's members, as a body, in accordance with chapter 3 of part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
S Drain
(Senior Statutory Auditor)
For and on behalf of
Edmund Carr LLP
Chartered Accountants & Statutory Auditor
146 New London Road
Chelmsford
Essex
CM2 0AW
19 February 2024
Peregrine Livefoods Ltd
Statement of Comprehensive Income
Year ended 31 May 2023
2023
2022
Note
£
£
Turnover
4
20,015,524
20,790,898
Cost of sales
15,510,953
16,218,915
-------------
-------------
Gross profit
4,504,571
4,571,983
Administrative expenses
4,396,397
4,486,153
Other operating income
10,172
------------
------------
Operating (loss)/profit
5
108,174
96,002
Interest payable and similar expenses
9
166,305
51,842
------------
------------
(Loss)/profit before taxation
( 58,131)
44,160
Tax on (loss)/profit
10
33,258
27,830
--------
--------
(Loss)/profit for the financial year and total comprehensive income
( 91,389)
16,330
--------
--------
All the activities of the company are from continuing operations.
Peregrine Livefoods Ltd
Statement of Financial Position
31 May 2023
2023
2022
Note
£
£
£
£
Fixed assets
Intangible assets
11
186,431
171,250
Tangible assets
12
1,271,320
521,606
------------
---------
1,457,751
692,856
Current assets
Stocks
13
1,597,824
1,586,344
Debtors
14
2,423,100
2,296,863
Cash at bank and in hand
102,937
38,978
------------
------------
4,123,861
3,922,185
Creditors: amounts falling due within one year
15
4,468,186
3,943,192
------------
------------
Net current liabilities
344,325
21,007
------------
---------
Total assets less current liabilities
1,113,426
671,849
Creditors: amounts falling due after more than one year
16
806,779
239,570
Provisions
Taxation including deferred tax
18
144,328
111,071
------------
---------
Net assets
162,319
321,208
------------
---------
Capital and reserves
Called up share capital
22
135
135
Capital redemption reserve
23
7
7
Profit and loss account
23
162,177
321,066
---------
---------
Shareholders funds
162,319
321,208
---------
---------
These financial statements were approved by the board of directors and authorised for issue on 19 February 2024 , and are signed on behalf of the board by:
C M Jones
Director
Company registration number: 04415888
Peregrine Livefoods Ltd
Statement of Changes in Equity
Year ended 31 May 2023
Called up share capital
Capital redemption reserve
Profit and loss account
Total
£
£
£
£
At 1 June 2021
116
7
1,137,236
1,137,359
Profit for the year
16,330
16,330
----
----
------------
------------
Total comprehensive income for the year
16,330
16,330
Issue of shares
19
19
Capital contributions to Employee Ownership Trust
(780,000)
(780,000)
Capital contributions to Employee Benefit Trust
(52,500)
(52,500)
----
----
------------
------------
Total investments by and distributions to owners
19
( 832,500)
( 832,481)
At 31 May 2022
135
7
321,066
321,208
Loss for the year
( 91,389)
( 91,389)
----
----
------------
------------
Total comprehensive income for the year
( 91,389)
( 91,389)
Capital contributions to Employee Benefit Trust
(67,500)
(67,500)
----
----
--------
--------
Total investments by and distributions to owners
( 67,500)
( 67,500)
----
----
---------
---------
At 31 May 2023
135
7
162,177
162,319
----
----
---------
---------
Peregrine Livefoods Ltd
Statement of Cash Flows
Year ended 31 May 2023
2023
2022
£
£
Cash flows from operating activities
(Loss)/profit for the financial year
( 91,389)
16,330
Adjustments for:
Depreciation of tangible assets
200,759
177,449
Amortisation of intangible assets
53,319
23,750
Government grant income
( 10,172)
Interest payable and similar expenses
166,305
51,842
(Gains)/loss on disposal of tangible assets
( 17,484)
8,770
Tax on (loss)/profit
33,258
27,830
Accrued expenses/(income)
58,941
( 107,863)
Changes in:
Stocks
( 11,480)
( 103,754)
Trade and other debtors
( 126,237)
( 141,850)
Trade and other creditors
415,729
877,635
---------
---------
Cash generated from operations
681,721
819,967
Interest paid
( 166,305)
( 51,842)
Tax paid
( 105,143)
---------
---------
Net cash from operating activities
410,273
768,125
---------
---------
Cash flows from investing activities
Purchase of tangible assets
( 70,783)
( 236,062)
Proceeds from sale of tangible assets
40,216
9,680
Purchase of intangible assets
( 68,500)
( 175,000)
---------
---------
Net cash used in investing activities
( 99,067)
( 401,382)
---------
---------
Cash flows from financing activities
Proceeds from issue of ordinary shares
19
Repayment of borrowings
( 33,544)
( 33,061)
Government grant income
10,172
Payments of finance lease liabilities
( 146,203)
65,340
Capital contributions to Employee Ownership Trust
(780,000)
Capital contribution to Employee Benefit Trust
(67,500)
(52,500)
---------
---------
Net cash used in financing activities
( 247,247)
( 790,030)
---------
---------
Net increase/(decrease) in cash and cash equivalents
63,959
( 423,287)
Cash and cash equivalents at beginning of year
38,978
462,265
---------
---------
Cash and cash equivalents at end of year
102,937
38,978
---------
---------
Peregrine Livefoods Ltd
Notes to the Financial Statements
Year ended 31 May 2023
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Rolls Farm Barn, Hastingwood Road, Magdalen Laver, Essex, CM5 0EN.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Going concern
The directors have considered the impact of the current economic climate in their assessment of the company's ability to prepare accounts as a going concern. While there are uncertainties surrounding the current high inflation and the economic slowdown the directors are of the opinion that the company have sufficient resources to continue trading for the next 12 months from the date of signing these accounts.
Consolidation
The entity has taken advantage of the exemption from preparing consolidated financial statements contained in Section 402 of the Companies Act 2006 on the basis that its subsidiaries are excluded from consolidation on the grounds that their inclusions is not material for the purpose of giving a true and fair view.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Revenue recognition
Turnover represents amounts receivable for goods and services net of VAT and trade discounts.
Income tax
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Foreign currencies
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.
Operating leases
Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis.
Goodwill
Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight-line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.
Intangible assets
Intangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated amortisation and impairment losses. Any intangible assets carried at revalued amounts, are recorded at the fair value at the date of revaluation, as determined by reference to an active market, less any subsequent accumulated amortisation and subsequent accumulated impairment losses. Intangible assets acquired as part of a business combination are only recognised separately from goodwill when they arise from contractual or other legal rights, are separable, the expected future economic benefits are probable and the cost or value can be measured reliably.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Goodwill
-
5 years
Patents, trademarks and licences
-
5 years
Website
-
3 years
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Leasehold property
-
over the period of the lease
Plant and machinery
-
10-33% straight line & 25% reducing balance
Fixtures and fittings
-
25% reducing balance
Motor vehicles
-
25% reducing balance
Livestock
-
20 % straight line
Research and development policy
Research expenditure is written off in the period in which it is incurred.
Development expenditure incurred is capitalised as an intangible asset only when all of the following criteria are met:
- It is technically feasible to complete the intangible asset so that it will be available for use or sale;
- There is the intention to complete the intangible asset and use or sell it;
- There is the ability to use or sell the intangible asset;
- The use or sale of the intangible asset will generate probable future economic benefits;
- There are adequate technical, financial and other resources available to complete the development and to use or sell the intangible asset; and
- The expenditure attributable to the intangible asset during its development can be measured reliably.
Expenditure that does not meet the above criteria is expensed as incurred.
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.
Finance leases and hire purchase contracts
Assets held under finance leases and hire purchase contracts are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.
Government grants
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model and the performance model. Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable. Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income and not deducted from the carrying amount of the asset. Under the performance model, where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.
Financial instruments
Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as either financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
4. Turnover
Turnover arises from:
2023
2022
£
£
Sale of goods
20,015,524
20,790,898
-------------
-------------
An analysis of turnover is given below:
2023
2022
£
£
United Kingdom
19,864,410
20,632,542
Europe
1,997
25,279
Rest of the World
149,117
133,077
-------------
-------------
Sales
20,015,524
20,790,898
-------------
-------------
5. Operating (loss)/profit
Operating profit or loss is stated after charging/crediting:
2023
2022
£
£
Amortisation of intangible assets
53,319
23,750
Depreciation of tangible assets
200,759
177,449
(Gains)/loss on disposal of tangible assets
( 17,484)
8,770
Impairment of trade debtors
17,309
21,308
Foreign exchange differences
( 22,449)
( 7,767)
---------
---------
6. Auditor's remuneration
2023
2022
£
£
Fees payable for the audit of the financial statements
14,000
11,750
--------
--------
Fees payable to the company's auditor and its associates for other services:
Other non-audit services
1,550
3,122
--------
--------
7. Staff costs
The average number of persons employed by the company during the year, including the directors, amounted to:
2023
2022
No.
No.
Production staff
121
133
Administrative staff
45
53
----
----
166
186
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2023
2022
£
£
Wages and salaries
4,397,047
4,628,390
Social security costs
415,058
433,725
Other pension costs
86,877
101,268
------------
------------
4,898,982
5,163,383
------------
------------
8. Directors' remuneration
The directors' aggregate remuneration in respect of qualifying services was:
2023
2022
£
£
Remuneration
167,859
206,807
Company contributions to defined contribution pension plans
2,311
6,930
---------
---------
170,170
213,737
---------
---------
The number of directors who accrued benefits under company pension plans was as follows:
2023
2022
No.
No.
Defined contribution plans
4
3
----
----
Remuneration of the highest paid director in respect of qualifying services:
2023
2022
£
£
Aggregate remuneration
96,800
102,139
Company contributions to defined contribution pension plans
1,384
4,864
--------
---------
98,184
107,003
--------
---------
9. Interest payable and similar expenses
2023
2022
£
£
Interest on banks loans and overdrafts
33,706
19,145
Interest on obligations under finance leases and hire purchase contracts
61,786
7,339
Factoring interest
70,813
25,358
---------
--------
166,305
51,842
---------
--------
10. Tax on (loss)/profit
Major components of tax expense
2023
2022
£
£
Current tax:
UK current tax expense
898
Adjustments in respect of prior periods
( 31,146)
----
--------
Total current tax
( 30,248)
----
--------
Deferred tax:
Origination and reversal of timing differences
33,258
58,078
--------
--------
Tax on (loss)/profit
33,258
27,830
--------
--------
Reconciliation of tax expense
The tax assessed on the (loss)/profit on ordinary activities for the year is higher than (2022: higher than) the standard rate of corporation tax in the UK of 19 % (2022: 19 %).
2023
2022
£
£
(Loss)/profit on ordinary activities before taxation
( 58,131)
44,160
--------
--------
(Loss)/profit on ordinary activities by rate of tax
( 11,045)
8,391
Adjustment to tax charge in respect of prior periods
( 31,146)
Effect of expenses not deductible for tax purposes
213
15,762
Effect of capital allowances and depreciation
( 95,061)
( 23,255)
Unused tax losses
105,893
Short term timing differences
33,258
58,078
---------
--------
Tax on (loss)/profit
33,258
27,830
---------
--------
11. Intangible assets
Goodwill
Patents, trademarks and licences
Website
Total
£
£
£
£
Cost
At 1 June 2022
175,000
75,000
250,000
Additions
68,500
68,500
---------
--------
--------
---------
At 31 May 2023
175,000
75,000
68,500
318,500
---------
--------
--------
---------
Amortisation
At 1 June 2022
8,750
70,000
78,750
Charge for the year
35,000
5,000
13,319
53,319
---------
--------
--------
---------
At 31 May 2023
43,750
75,000
13,319
132,069
---------
--------
--------
---------
Carrying amount
At 31 May 2023
131,250
55,181
186,431
---------
--------
--------
---------
At 31 May 2022
166,250
5,000
171,250
---------
--------
--------
---------
12. Tangible assets
Land and buildings
Plant and machinery
Fixtures and fittings
Motor vehicles
Livestock
Total
£
£
£
£
£
£
Cost
At 1 Jun 2022
19,085
699,057
1,173,035
231,827
57,174
2,180,178
Additions
501,466
375,657
94,822
1,260
973,205
Disposals
( 75,667)
( 75,667)
--------
------------
------------
---------
--------
------------
At 31 May 2023
19,085
1,200,523
1,548,692
250,982
58,434
3,077,716
--------
------------
------------
---------
--------
------------
Depreciation
At 1 Jun 2022
19,085
565,247
975,793
69,377
29,070
1,658,572
Charge for the year
91,215
51,575
46,493
11,476
200,759
Disposals
( 52,935)
( 52,935)
--------
------------
------------
---------
--------
------------
At 31 May 2023
19,085
656,462
1,027,368
62,935
40,546
1,806,396
--------
------------
------------
---------
--------
------------
Carrying amount
At 31 May 2023
544,061
521,324
188,047
17,888
1,271,320
--------
------------
------------
---------
--------
------------
At 31 May 2022
133,810
197,242
162,450
28,104
521,606
--------
------------
------------
---------
--------
------------
Finance leases and hire purchase contracts
Included within the carrying value of tangible assets are the following amounts relating to assets held under finance leases or hire purchase agreements:
Plant and machinery
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
At 31 May 2023
448,446
336,411
188,047
972,904
---------
---------
---------
---------
At 31 May 2022
19,000
8,919
144,934
172,853
---------
---------
---------
---------
13. Stocks
2023
2022
£
£
Raw materials and consumables
1,597,824
1,586,344
------------
------------
14. Debtors
2023
2022
£
£
Trade debtors
1,884,882
1,924,233
Prepayments and accrued income
538,218
372,630
------------
------------
2,423,100
2,296,863
------------
------------
15. Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans and overdrafts
45,859
37,397
Trade creditors
1,630,286
1,244,764
Accruals and deferred income
286,216
227,275
Corporation tax
125,326
230,468
Social security and other taxes
476,056
474,658
Obligations under finance leases and hire purchase contracts
171,663
54,659
Other creditors
1,732,780
1,673,971
------------
------------
4,468,186
3,943,192
------------
------------
Included within other creditors is £1,410,908 (2022: £1,353,506) due to a factoring company. This amount is secured on trade debtors of £1,981,412.
16. Creditors: amounts falling due after more than one year
2023
2022
£
£
Bank loans and overdrafts
72,912
114,918
Obligations under finance leases and hire purchase contracts
733,867
94,652
Other creditors
30,000
---------
---------
806,779
239,570
---------
---------
Included within creditors: amounts falling due after more than one year is an amount of £98,150 (2022: £Nil) in respect of liabilities payable or repayable by instalments which fall due for payment after more than five years from the reporting date.
17. Finance leases and hire purchase contracts
The total future minimum lease payments under finance leases and hire purchase contracts are as follows:
2023
2022
£
£
Not later than 1 year
171,663
54,659
Later than 1 year and not later than 5 years
635,717
94,652
Later than 5 years
98,150
---------
---------
905,530
149,311
---------
---------
The finance lease and hire purchase obligations are effectively secured on the underlying assets of the company.
18. Provisions
Deferred tax (note 19)
£
At 1 June 2022
111,071
Additions
33,257
---------
At 31 May 2023
144,328
---------
19. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2023
2022
£
£
Included in provisions (note 18)
144,328
111,071
---------
---------
The deferred tax account consists of the tax effect of timing differences in respect of:
2023
2022
£
£
Accelerated capital allowances
250,222
111,071
Unused tax losses
( 105,894)
---------
---------
144,328
111,071
---------
---------
20. Employee benefits
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 86,877 (2022: £ 101,268 ).
21. Government grants
The amounts recognised in the financial statements for government grants are as follows:
2023
2022
£
£
Recognised in other operating income:
Government grants recognised directly in income
10,172
----
--------
22. Called up share capital
Issued, called up and fully paid
2023
2022
No.
£
No.
£
A Ordinary shares of £ 1 each
102
102
102
102
B Ordinary shares of £ 1 each
33
33
33
33
----
----
----
----
135
135
135
135
----
----
----
----
The A and B Ordinary shares rank pari passu in all respects but constitute separate classes of shares.
23. Reserves
Profit and loss account - This reserve records retained earnings and accumulated losses.
24. Analysis of changes in net debt
At 1 Jun 2022
Cash flows
At 31 May 2023
£
£
£
Cash at bank and in hand
38,978
63,959
102,937
Debt due within one year
(92,056)
(125,466)
(217,522)
Debt due after one year
(209,570)
(597,209)
(806,779)
---------
---------
---------
( 262,648)
( 658,716)
( 921,364)
---------
---------
---------
25. Operating leases
The total future minimum lease payments under non-cancellable operating leases are as follows:
2023
2022
£
£
Not later than 1 year
431,508
413,230
Later than 1 year and not later than 5 years
1,197,795
1,493,615
Later than 5 years
2,149,395
1,627,023
------------
------------
3,778,698
3,533,868
------------
------------
26. Related party transactions
As directors of Peregrine Livefoods Limited and Peregrine Livefoods Trustee Limited, Mr C Jones and Mr D Perry are considered related parties. However, Mr D Perry resigned as director of Peregrine Livefoods Limited during the year.Mr R Beattie and Mrs J Daniel are also considered related parties and were appointed directors during the year. The A Ordinary shares of Peregrine Livefoods Ltd are registered in the name of Peregrine Livefoods Trustee Ltd on behalf of the Peregrine Livefoods Employee Ownership Trust.